The SEVEN Things You NEED To Learn for Your Financial FREEDOM - Robert Kiyosaki

Summary

In this engaging video, the speaker contrasts traditional education with the teachings of *Rich Dad Poor Dad*, emphasizing the importance of financial literacy. They argue that schools fail to teach essential skills like understanding financial statements, managing assets, and entrepreneurship. The speaker shares insights on how focusing on acquiring assets, such as real estate, leads to financial freedom, while many people remain trapped by a focus on earning income and paying taxes. By challenging conventional wisdom and encouraging risk-taking, the speaker offers an alternative approach to financial success, inspiring viewers to adopt a mindset geared toward wealth-building and long-term financial independence.

Takeaways

• 😀 Financial literacy is crucial, and understanding financial statements like income statements, balance sheets, and cash flow statements is key to managing money effectively.
• 😀 The 'Rich Dad Poor Dad' philosophy contrasts two mindsets: one focusing on earning income (Poor Dad) and the other on acquiring assets (Rich Dad).
• 😀 Building assets that generate passive income, rather than focusing on just earning a salary, is the key to achieving financial freedom.
• 😀 Traditional education systems often fail to teach practical financial skills, leaving graduates unprepared for real-world financial challenges.
• 😀 Real money, such as gold and silver, is considered 'God’s money,' while fiat currency (e.g., the dollar) is seen as 'fake money' prone to inflation.
• 😀 Risk-taking is essential for financial success; avoiding risks may lead to financial stagnation.
• 😀 Many people focus too much on income, ignoring the importance of managing assets that create wealth in the long term.
• 😀 The government and central banks often print 'fake money' to protect financial institutions, but this doesn't benefit individual citizens.
• 😀 Entrepreneurs and investors benefit from tax strategies that help minimize their tax burdens, which employees typically cannot access.
• 😀 The Cashflow board game was created to help people learn financial concepts in an interactive and engaging way, offering a real-life simulation of managing finances.
• 😀 Understanding taxes is critical for entrepreneurs and investors, as different earners pay vastly different tax rates, impacting wealth-building opportunities.

Q & A

What was the speaker's experience with accounting during business school?

The speaker found accounting to be the most difficult subject in business school, even falling asleep during the course. They also had a conflict with the teacher, whom they felt had little practical knowledge of accounting.

Why does the speaker believe Rich Dad Poor Dad is relevant today?

The speaker believes that Rich Dad Poor Dad is highly relevant because it focuses on understanding financial statements—key documents like income statements, balance sheets, and cash flow statements—which most people graduating from school don't even understand.

What was the speaker's motivation for creating the Cashflow board game?

The speaker created the Cashflow board game to teach people about accounting and financial literacy, especially since the education system doesn’t adequately prepare individuals for managing their own finances or understanding key financial statements.

How does the speaker differentiate between the four categories in the Cashflow quadrant?

The Cashflow quadrant consists of four categories: 'E' for employees who work for job security and a paycheck; 'S' for self-employed individuals or small business owners; 'B' for big business owners with large-scale operations; and 'I' for investors who focus on building wealth through assets.

What shift in mindset did the speaker experience after buying investment properties?

The speaker shifted their focus from earning income through a job to acquiring assets that generate passive income. This mindset shift led them to focus on building and acquiring assets, which in turn generated income.

Why does the speaker emphasize the importance of focusing on assets rather than income?

The speaker stresses that focusing on acquiring assets is the key to long-term financial freedom. By accumulating assets that generate income, rather than just working for a paycheck, individuals can achieve financial independence.

What does the speaker mean by 'God's money' and why is it significant?

The speaker refers to gold and silver as 'God's money' because they are real, tangible assets that cannot be faked, unlike fiat currencies such as the dollar. These precious metals have been valuable throughout history and will continue to hold value long-term.

What is the speaker’s view on the current education system?

The speaker believes that the education system is flawed because it teaches students to memorize the 'right answers' and focus on job security, rather than taking risks or learning how to manage finances, invest, or think entrepreneurially.

How does the speaker differentiate between the different tax burdens on different types of earners?

The speaker explains that employees face the highest tax rates, often paying up to 40% in taxes, while self-employed individuals and business owners pay slightly less, and investors can avoid taxes altogether if they focus on investing and acquiring assets.

What lesson does the speaker share about Ray Kroc and McDonald's business model?

The speaker shares that Ray Kroc, the founder of McDonald's, understood that McDonald's is not in the hamburger business but in the real estate business. The company makes money by acquiring valuable real estate, which in turn helps generate more income, emphasizing the importance of owning assets.